Pirate Bay Swashbucklers Convicted in Swedish Court

By Richard Adhikari
Apr 17, 2009 11:59 AM PT

The music industry cheered as a Swedish court on Friday found the four proprietors of The Pirate Bay guilty of copyright law violation.

The Pirate Bay is a torrent tracker site in Sweden that helps users find and download files used to swap movies, music, TV shows, games, books and software via BitTorrent file-sharing applications. It was accessed by more than 20 million people worldwide last year.

The defendants have vowed to appeal.

The Hammer of the Court

The four defendants -- Hans Fredrik Neij, Gottfried Svartholm Warg, Peter Sunde and Carl Lundstrom -- were indicted in a Swedish court in January of 2008 on charges of being accessories to breaking copyright law.

On Friday they were found guilty of infringing copyright law and sentenced to one year each in jail. They were also fined a total of more than US$3.5 million, which will be paid to various media and entertainment companies like Warner Bros., EMI, Sony Music Entertainment and Columbia Pictures.

Neij and Warg are the founders of Pirate Bay, Lunde the spokesperson and programmer, and Lundstrom the financier.

They have vowed to fight on and said they will not pay the fine.

Music Is Love

IFPI, the International Federation of the Phonographic Industry, which represents the recording industry worldwide, hailed the verdict. "IFPI believes the Swedish court's verdict reflects the serious damage caused by The Pirate Bay, which has abused the copyrights of artists, songwriters and record producers for many years," spokesperson Alex Jacob told the E-Commerce Times. "We expect The Pirate Bay to appeal the verdict, but have every confidence the judgment will be upheld."

The music industry's enthusiasm is rooted in the fact that it has been steadily losing revenue from music sales over the years -- losses it often blames on the rise of digital music sharing over the last decade. IFPI's Digital Music Report 2009 claims that 95 percent of music downloads are unauthorized and calls on Internet service providers to cooperate in fighting these unauthorized downloads.

That fight, however, has often taken ugly turns. For instance, the Recording Industry Association of America has launched thousands of lawsuits against illegal file-sharers, many of whom end up paying thousands for trading a few songs. Some lawsuits have targeted single moms, senior citizens and individuals who actually pay a great deal of money to legitimately buy the music they share -- all in all, not a pretty picture from a PR perspective.

Even musicians themselves are rebelling against the music industry. "A lot of artists are going direct now, and they make more than the three percent or so they get from the media companies," Carl Howe, an analyst at Yankee Group, told the E-Commerce Times.

That keeps music industry executives' adrenalin flowing freely. Back in 2007, when Prince announced he would give away a free CD, the music industry went gaga, claiming that the move would be an insult to record stores and threatening to take his music off store shelves.

All Is Not What It Seems

The Pirate Bay case is far from simple, and some politics appear to have crept into it, the Yankee Group's Howe said.

"The judgment includes Warg's conviction on violating certain goods hazardous to ... health -- what we in the U.S. would call 'drug possession,'" he explained. Two other drug-related charges had been dropped. "There seems to be a lot of politics involved."

Politics indeed -- the Expo Foundation, a non-profit organization set up in Sweden in 1995 to fight racism and right-wing organizations, claims that Carl Lundstrom has donated money to right-wing parties and done business with companies supporting the white power movement. Lundstrom is the defendant who bankrolled The Pirate Bay.

Trouble for the Web?

More importantly, however, the Swedish court's verdict could impact Internet traffic because it creates a precedent that could be used against any company providing ways to illegally attain copyrighted material, rather than the material itself, the Yankee Group's Howe said.

"The defendants have been convicted of assisting in violation of copyright law, but all they did was provide links to Web sites," he explained. "They didn't host the copyrighted content on their servers."

Applying the logic of this judgment could imperil sites like MySpace, News Corp., and Google because they, too, provide links to copyrighted material, Howe pointed out.

"It's law at its worst," he added. "It's the law trying to catch up with technology."